Online Gambling began gaining in popularity in the 1990s. Originally, it appeared to be an end-run around government regulation, as online gambling operators could set up shop in offshore jurisdictions, making them completely accessible to anyone with a computer and a credit card. But as the Internet has grown, so has its reach, and the Department of Justice and Congress have begun exploring legal regulation.
However, the legality of online gambling remains a matter of debate in the United States and varies from state to state. For example, the Unlawful Internet Gambling Enforcement Act of 2006 has limited the ability of banks to transact with illegal internet gambling sites, but does not define online gambling as a whole. In addition, the Wire Act, which is often cited as prohibiting all forms of online gambling, does not cover online lottery, poker or casino sites.
As a result, illegal gambling on the Internet may violate federal criminal statutes. However, since gambling is primarily governed by state law, federal law can be useful in bolstering state laws. Further, state officials are concerned about the potential for the internet to introduce illegal gambling into their jurisdictions. In order to combat this, states have begun to enforce stricter laws regarding online gambling.
Online gambling is illegal in most states. It is prohibited under 31 U.S.C. 5362(10). The Wire Act bans gambling on sporting events and contests, while the Travel Act prohibits betting on interstate commerce. In addition, certain activities involving illegal gambling may violate the Racketeer Influenced and Corrupt Organizations Act (RICO).